|Bid||0.00 x 1200|
|Ask||0.00 x 2900|
|Day's Range||36.54 - 36.74|
|52 Week Range||35.17 - 46.56|
|PE Ratio (TTM)||N/A|
|Expense Ratio (net)||0.43%|
This article was originally published on ETFTrends.com. The new round of Chinese tariffs took effect today as the U.S.-China trade disputes don’t appear to be diminishing, which will increase the cost of homebuilding and thus, affect homebuilder ETFs like the iShares US Home Construction ETF (ITB), SPDR S&P Homebuilders ETF (XHB) and the Invesco Dynamic Building & Construction ETF (PKB) . The housing market is already feeling the pangs of rising interest rates crimping homebuyer enthusiasm to take on financing to purchase real estate.
Home builder stocks were broadly lower Monday, as mortgage-finance company Freddie Mac said the U.S. housing market had "essentially stalled." The iShares U.S. Home Construction ETF slumped 0.8% in morning trade, with 39 of its 47 equity components trading lower. Among the more active home builders, shares of PulteGroup Inc. shed 1.2%, of D.R. Horton Inc. gave up 0.5%, of Lennar Corp. lost 0.8% and of Toll Brothers Inc. fell 1.2%, while KB Home's stock climbed 1.5%. Elsewhere, shares of home improvement retailers Home Depot Inc. declined 0.8% and of Lowe's Companies dropped 1.0%. Freddie Mac said despite slightly improving inventory conditions and home price pressures, it now expects home sales in 2018 to be "just below" last years's level. "The spring and summer home buying and selling season ultimately ended up being a letdown, despite a faster growing economy and healthy demand for buying a home," said Freddie Mac Chief Economist Sam Khater. "Unfortunately, too many would-be buyers continue to be tripped up by not enough affordable supply and the one-two punch of much higher home prices and mortgage rates." The home builder ETF has lost 16% year to date, while the S&P 500 has gained 9.2%.
Homebuilder ETFs weakened Friday after J.P. Morgan analysts downgraded a number of home construction companies on a pessimism over housing market fundamentals. On Friday, the SPDR S&P Homebuilders ETF ...
The home builder sector ETF hit a new low for this year, after J.P. Morgan’s Michael Rehaut downgraded a handful of companies, citing concerns over weakening housing market fundamentals.
Based on the Modern Homebuyer Survey, almost half of the participants cited that the competition for home buying is decreasing, which could bode well for traders looking to leverage homebuilder ETFs like the Direxion Daily Homebuilders and Supplies Bull and Bear 3X Shares (NAIL) . The survey results showed that more than 50% of participants felt competition is thinning in areas like Colorado, California and New York. This could signal an impending shift from a seller's market to a buyer's market, which could force the hand of homebuilders to meet increased demand.
Lennar Corp.'s credit rating was upgraded Monday out of "junk" territory, following the completion of the deal in which the homebuilder acquired CalAtlantic Group Inc. in a $9.3 billion deal. The outlook was revised to stable. Fitch raised its rating to BBB-, the lowest investment grade rating, from BB+. The deal, which closed in February, and included $3.6 billion in assumed debt, created the largest homebuilder in terms of revenue and lifted the company into a top-3 position in 27 of the 30 largest metropolitan markets. "Fitch views this as an advantage as scale in local metro markets is becoming increasingly more important as homebuilders look for efficiencies in purchasing amid escalating costs," Fitch said. The stock has lost 20% year to date, while the iShares U.S. Home Construction ETF has lost 14% and the S&P 500 has gained 7.7%.
Shares of Hovnanian Enterprises Inc. rallied 3.9% in early morning trade Monday, after the home builder reported a fiscal third-quarter loss that narrowed more than expected, although revenue missed expectations. The net loss for the quarter to July 31 was $1.0 million, or a penny a share, after a loss of $337.2 million, or $2.28 a share, in the same period a year ago, as the valuation allowance for deferred tax assets increased $294 million. The FactSet consensus was for a loss per share of 6 cents. Revenue fell to $456.7 million from $592.0 million, below the FactSet sales consensus of $504.3 million. Homebuilding gross margin improved to 15.4% from 12.8%, while contracts per community rose 9.8% to 10.1 contracts per community. The total number of contracts declined 5.3% to 1,451 homes. "Assuming no adverse changes in current market conditions, we continue to expect solid profitability during the fourth quarter of fiscal 2018," said Chief Executive Ara Hovnanian. The stock has tumbled 52% year to date, while the iShares U.S. Home Construction ETF has shed 14% and the S&P 500 has gained 7.8%.
As the world approaches the 10-year anniversary of the bursting of the housing bubble, should investors brace themselves for an unsettling sense of déjà vu?
Homebuilder stocks led Tuesday gains with sector-related ETFs breaking above their short-term trend lines after Toll Brothers (TOL) beat second quarter earnings expectations. On Tuesday, the iShares U.S. Home Construction ETF (ITB) , the largest homebuilder-related ETF, jumped 3.7% and the equally weighted SPDR S&P Homebuilders ETF (XHB) rose 2.6%. Fueling the surge in homebuilders, Toll Brothers revealed profits rose 30% in its latest quarter on strong growth in deliveries and ongoing deals with customers, reports Kimberly Chin for the Wall Street Journal.
Beaten-down homebuilder stocks and ETFs rallied Tuesday, boosted by Toll Bros.' quarterly results and massive price move.
Construction on new houses increased by less than 1% in July, reflecting a recent slowdown in building that’s likely tied to higher mortgage rates and growing shortages of skilled craftsmen. Housing starts edged up to an annual rate of 1.17 million.
Three of the biggest homebuilder ETFs have been feeling the pangs of the current economic landscape of rising rates, such as iShares US Home Construction ETF (ITB) --down 12.53% year-to-date, SPDR S&P Homebuilders ETF (XHB) --down 10.26% YTD and Invesco Dynamic Building & Const ETF (PKB) --down 11.90 YTD%. Despite this, all is not lost according to Robert Dietz, a chief economist and senior vice president for Economics and Housing Policy at the National Association of Home Builders. "Rising interest rates are a concern in the housing sector," Dietz said in a blog.
This Week In Economic Data Land Pending home sales on Monday. Case Shiller 20 real estate prices, Chicago PMI, and PCE inflation rate on Tuesday. Relevant ETFs (BATS:ITB) (NYSEARCA:GLD). ISM manufacturing, car and truck sales, and Fed funds rate decision on Wednesday. Initial jobless claims on Thursday. Non-farm payrolls, unemployment rate on Friday. Plus there’s […] The post Market Morning: Data Galore, Disney Gets Fox-ed, CBS to be #MeToo’ed, Trump Threatens Shutdown appeared first on Market Exclusive.
Poof! David Copperfield, meet Mark Zuckerberg. Instead of making a jetliner disappear on a Las Vegas stage, the chief executive of Facebook made $119 billion evaporate from the social-media giant’s stock-market value on Thursday after uttering some less-than-encouraging words about future growth and expenses.
The housing market took a blow today as the Department of Commerce reported that U.S. homebuilding fell to a nine-month low in June while building permits declined for a third straight month. In addition, ...
A closely-watched gauge of sentiment among residential construction firms shows builders are caught between good conditions for their products and higher input costs thanks to Washington posturing.
This Week On the Economic Calendar: Manufacturing, Foreign T-Bond Buyers, Housing Starts Not too busy of an economic calendar this week but there will be a few significant reads out of the United States. Manufacturing data comes out of the New York Fed today, and foreign buyers of T-bonds on Tuesday which should help gauge […] The post Market Morning: Lybia Cuts Oil Output, May Makes Brexit Demands, Amazon to Data Switches appeared first on Market Exclusive.
To profit from a potential correction in overvalued commercial real estate, BCA Research recommends a circuitous route: buy home-builder stocks and sell short real-estate investment trusts. Unlike CRE–where overbuilding has resulted in problems for borrowers to service debt, portending increasing delinquencies, charge-offs and delinquencies–there's a widely noted shortage of supply for new and existing homes for sale. BCA recommends buying a package of Lennar (LEN), PulteGroup (PHM) and D.R. Horton (DHI) and shorting a slew of REITs.
According to the Census Bureau’s website, it takes six months to establish a trend in new home (DHI) sales, and there was no change in the new home sales (ITB) trend, according to the June report. The Census Bureau reported that the median sales price for new homes sold in May was $313,000 as compared to $312,000 in April, and the average home price in May was $368,500 as compared to $407,300 in April.
The United States National Association of Realtors (or NAR) releases a monthly report on the existing home sales (ITB) market. Trends in existing housing inventory, total housing inventory, median home prices, and the mortgage rates are released through this report. Investors can assess the appetite of home buyers in the secondary housing market (REM) through this report.
The changes to the number of building permits issued every month give investors an idea about the trends in the housing (REM) sector. The number of building permits issued every month also acts as a forward indicator for the economy because an increase in the number of building permits in any given month is a signal for increased activity in the housing sector (DHI) in the future, as construction (ITB) activity begins after a few months of issuing the permit. As per the June report, housing units (XHB) authorized by building permits were at a seasonally adjusted rate of 1.30 million, a decline of 4.6% from the revised April reading of 1.36 million units.
The National Association of Home Builders (or NAHB) is an association of 700 state and local associations of home builders (REM), and real-estate sales and marketing professionals, and re-modelers. The NAHBA conducts a monthly survey of its members and constructs the housing market index (or HMI) based on the results of the survey. The survey asks respondents to rate the current conditions and expected conditions in the next six months as “good,” “fair,” or “poor.” The survey mostly relates to the single-family housing (ITB) market.
The US Fed has clearly communicated its intentions to continue the rate hike path at the June monetary policy meeting, as the US economy continued to expand. The US Fed hiked interest rates by 25 basis points at that meeting and left the doors open for two more hikes in 2018. Rising interest rates increase the cost of owning a home for prospective buyers, but the impact hasn’t yet been felt by the housing (XHB) markets, as the recent economic data continues to paint a rosy picture for the housing sector.